CENTRAL
AMERICA UP IN ARMS OVER CAFTA
By David Bacon
Pacific News Service

PUERTO CORTEZ, HONDURAS (5/12/05) -- When the Honduran Congress took up
ratification of the Central American Free Trade Agreement March 3, over
a thousand demonstrators filled the streets of Tegucigalpa, angrily denouncing
the effort. Congress ratified CAFTA anyway, but the crowd was so angry
that terrified deputies quickly fled.

“We
chased them out, and then we went into the chambers ourselves,”
says Erasmo Flores, president of the Sindicato Nacional de Motoristas
de Epuipo Pesado de Honduras (SINAMEQUIPH), the union for Honduras’
port truckers. “Then we constituted ourselves as the congress of
the true representatives of the Honduran people, and voted to scrap Congress’
ratification.”

Similar
demonstrations have multiplied across Central America, and just weeks
ago police shot into a crowd of protestors in Guatemala, killing one.
Meanwhile, however, growing controversy has not helped the treaty's main
supporter, US President George Bush, to find the votes he needs to pass
it in Washington.

While
admittedly an act of political theater by the leftwing Bloque Popular,
the Honduran protest showed dramatically how unpopular the agreement is
in Central America, at least among workers and farmers. This is quite
a change from Mexico, where the promises of then-President Carlos Salinas
de Gortari deceived large sections of Mexican society, especially its
labor unions, into supporting the North American Free Trade Agreement
in 1991 and 92. While US workers might suffer job loss, Salinas cajoled,
Mexican workers would get those jobs. The country would be come a “first
world” economy, he promised, with first world living standards.

The
truth was bitter. Currency devaluation cost the jobs of a million Mexicans
in the first year after NAFTA went into effect alone. While US President
Bill Clinton bailed out investors threatened by the crash, it came at
the cost of Mexico’s oil, which then had to guarantee the loans,
instead promoting economic development. Tying hundreds of thousands of
low-wage maquiladora jobs to the US economy also made them vulnerable
to it. When consumers north of the border stopped buying goods during
the 2000-2001 recession, 400,000 border workers were laid off. And export-industry
wages, far from rising, remained flat, while prices of milk, tortillas,
gasoline, bus fare and most working-class necessities skyrocketed.

But
the most devastating effect on workers came from privatization, enforced
by NAFTA’s mandate to make Mexico more investor-friendly. As ports,
railroads, airlines, mines, telephones and many other large national enterprises
were sold off, sometimes for just a fraction of their worth, new private
owners cut labor costs by slashing jobs and gutting union contracts. In
NAFTA’s first decade, Mexico’s privatization created more
billionaires than any other country in the world.

CAFTA
is built on the same political premise. It seeks to reinforce the transformation
of Central American economies, maintaining a low standard of living as
a means to attract investment in factories producing, not for an internal
market, but for export to the US. Understandably, this vision is hardly
popular among workers and unions. But hundreds of thousands of Central
American jobs are already tied to export production, and the Bush administration
can and does use them as bargaining leverage, threatening economic disaster
by raising the specter of import barriers against countries that won’t
adopt CAFTA.

CAFTA
promises to extend the harmful impacts of NAFTA to Mexico's weaker southern
neighbors. Most Central American nations currently belong to the Caribbean
Basin Initiative, which requires participating countries to uphold internationally
recognized labor norms. Using the example of NAFTA’s notoriously
ineffective labor side agreement, CAFTA only requires that governments
enforce their own laws, which are often far weaker.

Central
American public sector workers have been especially keen observers of
the Mexican experience. Honduras’ longshore workers’ union
has twice beaten back government efforts to privatize the docks of Puerto
Cortez, successfully mobilizing the whole town in the process. “We
put our union’s assets, like our soccer field and clinic, at the
service of the town,” explains Roberto Contreras, a union officer
and Honduran representative for the International Transport Federation.
“When the government tried to privatize our jobs, we told people
that if we didn’t cooperate to defeat it, the whole town would lose,
not just the port workers.”

In
El Salvador, huge protests accompanied government efforts to privatize
the healthcare system. And in Costa Rica, a massive strike by public telephone
and electrical workers forced the government to withdraw from CAFTA negotiations
in 2003.

On
March 9, Guatemala’s National Civilian Police sealed off the streets
around the Guatemalan Congress after it voted to ratify CAFTA, and then
used clubs and teargas against almost 2000 demonstrators. Following the
vote, popular organizations began mounting highway blockades throughout
the country, effectively halting commerce and travel. At a blockade in
Colotenango, at the Puente Naranjales crossroads, police and the army
fired on the crowd. Juan Lopez Velásquez was killed, and nine others
wounded by bullets.

Ironically,
the Bush administration has had more success strong-arming Central American
countries than their more powerful South American neighbors, or the US
Congress. In 2003 the World Trade Organization talks in Cancun collapsed
amid huge protests, and later in Miami, the big South American economies
of Brazil, Argentina and Venezuela told the administration they had little
interest in its carefully-orchestrated march towards a Free Trade Area
of the Americas.

Even
in the immediate aftermath of the September 11 attacks, the administration
could only muster a one-vote 216-to-215 majority in the US Congress to
give it fast track trade negotiating authority. Almost all observers agree
that if Bush had the votes to ratify CAFTA, he would have introduced it
into Congress long ago. The fact that the agreement has been negotiated,
has been ratified in most Central American countries (although amid bullets,
clubs and chanting protestors), and has yet to be introduced for ratification
in Washington, is the best indication that CAFTA's political support is
shrinking, not growing.

While
Bush and the agreement’s corporate backers still want it, it’s
getting harder for them to point to anyone else who does.